Dynegy Seeking Pollution Standards Relief In Illinois; Environmental Groups Oppose

February 12, 2018


Environmentalists in Illinois object to a plan put forth by Dynegy Inc. over state pollution standards.

Five environmental groups on Friday filed a motion to end hearings on Dynegy’s proposal before the Illinois Environmental Protection Agency (EPAI) for a temporary rule allowing the Houston-based energy provider’s fleet to increase sulfer dioxide and nitrogen oxide emissions from coal plants until Dynegy’s merger with Vistra Energy Corp. is complete.

Dynegy has been asking regulators for relief in meeting increasing expenses to keep aging coal plants generating power, and wants to go from rate-based emissions limits to an overall annual maximum for coal plants in Illinois.

The Environmental Defense Fund, the Environmental Law & Policy Center, the Natural Resources Defense Council, The Sierra Club and The Respiratory Health Association are asking the EPAI to withhold a special ruling on Dynegy’s request until the merger is complete.

The groups point out that once the merger is completed, the company will have more than “four billion dollars in equity” — an entirely different economic climate for the coal plants.

Irving-based Vistra is not part of the emissions request, and the environmental groups argue that the ability of Dynegy’s coal-fired electricity generation plants to keep running under current pollution standards should be considered after the merger.

Vistra would not be bound to any temporary new standards, should they be granted to Dynegy, but the groups are concerned that Vistra might push to continue the lowered standards.

TXU and Luminant parent Vistra signed a $1.7 billion common stock merger agreement with Dynegy last October which is undergoing regulatory approval and could be taken up by the Public Utility Commission of Texas very soon.

PUC staff on February 5th recommended that Vistra and Dynegy be required to divest some 1,280 MW of generation (the combined companies appear to exceed ERCOT‘s statutory cap of 20% of overall installed capacity) in order to secure merger approval.

Vistra has said it knows of a way for merger approval without divestitures.

The merged companies would be largest independent power producing company in the nation with expected market value of $10 billion.